Stephen Hillenburg intended to create a series of overly optimistic sponge that interfere with other characters. Hillenburg compared the concept to Laurel and Hardy and Pee-wee Herman. As he drew the character, he decided that "squeaky-clean square" (like a kitchen sponge) fit the concept.

The first concept sketch portrayed the character as wearing a red hat with a green base and a white shirt with necktie business. SpongeBob's look gradually progressed to brown pants that are used in the final design. SpongeBob is designed to be a child character as silly and optimistic in a style similar to that made famous by Jerry Lewis.

Initially the character was named SpongeBoy but this name is already in use. This was discovered after voice acting for the original seven minute pilot was recorded in 1997. Nickelodeon legal department discovered that the name was already in use for a mop product. After finding this out, Hillenburg decided that the character given name still had to contain "Sponge" so viewers would not mistake the character "Cheese Man." Hillenburg decided to use the name "SpongeBob". He chose "SquarePants" as a family name as it referred to a square shape and the character has "a nice ring to it".

Although SpongeBob's driver's license says his date of birth July 14, 1986, which would make this character is 12 (almost 13) years old at the time of his debut performance on May 1, 1999, Hillenburg joked that he is fifty in "sponge years". Explaining that SpongeBob actually has no specific age, but that he is old enough to be independent and still have to go to boating school. Her decision to have SpongeBob attend a boat driving school was made due to a request from Nickelodeon that the character attend a school.

SpongeBob is voiced by veteran voice actor Tom Kenny. Kenny previously worked with Hillenburg on Rocko's Modern Life, and when Hillenburg created SpongeBob SquarePants, he approached Kenny character voices. Hillenburg utilizing personality Kenny and others to help create the personality of SpongeBob.

The voice of SpongeBob was originally used by Kenny for a background character present in a crowd scene in Rocko's Modern Life. Kenny forgot the voice initially as he created only for a single use. But Hillenburg remember when he came up with SpongeBob and used a video clip episode to remind Kenny the voice. Kenny says that SpongeBob's high pitched laugh was specifically aimed at the unique, stating that they want annoying laugh in the tradition of Popeye and Woody Woodpecker.